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Inflation in other countries(trading partners)=>Higher input price for goods =>reduce competitive pressure on import-competing domestic goods price of domestic goods may increases. Alternative Way of looking at it: Country A trades with Country B. Currency B appreciates in relation to Currency A. Therefore, from Country A's point of view, it is more expensive to buy raw materials from Country B, but A will still buy raw materials because it is essential for production. As a result, the cost of production for goods increases due to a rise in price of raw materials. Hence, this will cause an increase in the general price level of goods and services in Country A that uses raw materials imported from Country B. Therefore, imported inflation occurs.
Wiki User
∙ 14y ago
Wiki User
∙ 13y agoinflation is important because it's the increase the price on food, etc. It could affect the people lives and some people who can't afford it. Basically it shows the economy isn't doing so good.
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How can we put a control on food inflation?
Food inflation is due to pressure from supply side and political instability in the Middle East. You would need to control the money supply in the economy , start by strengthening your domestic currency to make imports cheaper and exports costlier.Fruits and vegetables imported into the country and ban on food export will thus be buffered against inflation
Does inflation affect exchange rates?
Simply put, low inflation rates means higher demand in market including demand from foreign markets. This is translated in the price quoted for imported items. Thus, as import is increased so does money outflow. This means more foreign currency are needed (bought) to buy imported items and relatively the value of local currency rates will be depreciated.
Will inflation Peter out?
inflation peter out is when inflation diminish or stops .
What refers to the persistent increase in the prices of goods and services?
inflation
The consumers price index helps the U.S. government measure what?
inflation
Why car leasing has been stopped in Pakistan?
leasing is bad for economy Pakistani econmony. imported cars are sold, which is bad to econmy. as well as it create inflation and money gets block in one sector which is mostly based on foreign companies and imported goods.
How can we put a control on food inflation?
Food inflation is due to pressure from supply side and political instability in the Middle East. You would need to control the money supply in the economy , start by strengthening your domestic currency to make imports cheaper and exports costlier.Fruits and vegetables imported into the country and ban on food export will thus be buffered against inflation
Does inflation affect exchange rates?
Simply put, low inflation rates means higher demand in market including demand from foreign markets. This is translated in the price quoted for imported items. Thus, as import is increased so does money outflow. This means more foreign currency are needed (bought) to buy imported items and relatively the value of local currency rates will be depreciated.
Does CPI only count domestic goods?
Consumer Price Index, or CPI, is a measure of changes in the purchasing power of a currency and the rate of inflation. It also considers imported goods, as well as domestic products.
What inflation rate?
inflation
Inflation rates?
inflation
Will inflation Peter out?
inflation peter out is when inflation diminish or stops .
What refers to the persistent increase in the prices of goods and services?
inflation
inflation?
rising prices
The consumers price index helps the U.S. government measure what?
inflation
What will bi the formula of inflation?
Current year's inflation - last year's inflation / last year's inflation * 100 e.g ((B-A)/A)*100
What part of speech is inflation?
Inflation is a noun.
